Don’t chase the dollars!

Written by
Tom Butero
Added
May 23, 2013

The following conversation was overheard at the offices of the ABC agency. The parties involved were the agency CEO and the family services programme director:

PD: ‘I just of heard of this great new foundation grant! $100,000 a year to provide pre-natal support services for young parents.’

CEO: ‘That sounds great. Do we serve that population?’

PD: ‘Well, not yet, but we could. It’s $100,000!’

CEO: ‘What do they cover?’

PD: ‘Any operating expenses.’

CEO: ‘Any start-up money?’

PD: ‘Well, no, but it’s $100,000!’

CEO: ‘You really think we should go after this anyway?’

PD: ‘Absolutely! It’s $100,000!’

This conversation, or something like it, goes on every day in agencies and nonprofit organisations of one kind or another across the country. A new funding opportunity comes up and people jump at it, often without considering the effects, both positive and negative, that it might have on their organisation.

It’s not wise to jump at a funding opportunity without considering the implications.

I have always been a firm believer that chasing dollars for the sake of chasing dollars is never a good idea. I have seen agencies submit grant proposals for programmes and services that do not in any way meet the agency’s mission, population served, or, in some cases, even the geographic area they serve. Searching out and writing grants for a planned expansion is one thing. Trying to revamp an agency’s focus and even its mission statement to meet the requirements of a particular funding opportunity is a prime example of the tail wagging the dog.

On the other hand, there are plenty of examples where an organisation passed on a funding opportunity that they should have gone after. How do you know which ones to chase and which ones to ignore? If there were a simple formula the question would almost answer itself. There are some basic guidelines that I try to follow when considering any opportunity:

Does the grant supplement an existing programme or service in a way that helps the programme do a better job or allows it to expand?

If the grant is for what would be a new service, does it fit with the agency’s mission? If it means expanding into new areas of service, a broader geographic area, or some other new and, hopefully, exciting venture, has the agency’s management and board agreed that this is worth doing?

Trying to change your focus just to get that grant can often be a case of the tail wagging the dog.

Most grants are time limited and sustainability has become the watchword of the day, so how does the agency plan to sustain a new programme, for example, once the grant funding has ended?

Is there a matching funds requirement and does the organisation have the resources available to meet that requirement?

New services in particular often put added stress on an organisation’s infrastructure, affecting everything from the finance department to the availability of additional office space. Does the grant allow for coverage of any additional expenses related to the support of the programme or service?

Larger organisations often have a budget line item for management expenses that is based on a percentage of the agency’s overall operating budget. Most private foundations want to see their money go toward direct service, so one must ask, does the grant allow for management expenses to be included in the budget proposal?

Again, if the purpose of the grant is a new service, are there any funds available for start-up expenses, such as furniture, computers, etc?

What reporting or monitoring mechanisms will the foundation require?

Sustainability is the watchword of the day.

These are some of the basics that one should be examining when considering any funding proposal, be it a private foundation or any government based request for proposals. Understand that answering no to any number of these questions should not be the only determinant as to whether or not to go after a grant, but they are certainly issues that need to be examined before going forward.

No matter how one responds to the above stated issues, in the final analysis your organisation needs to ask itself whether it’s worth making the possible sacrifices and taking the risks on a new venture. This becomes even more of an issue if passing on a possible funding opportunity means the organisation is going to ‘miss the boat’ on a new initiative or trend that, in the long run, will leave it on the outside looking in.

Deciding on which opportunities to pursue is difficult and very subjective. Hopefully these suggestions will help in that decision making process.

About the author: Tom Butero

Tom Butero

Tom Butero is staff development coordinator at Child and Family Services in Massachusetts, USA. He has over 20 years of successful nonprofit management, including programme expansion, fundraising and grant writing, board development and strategic planning, staff and management training and consultation, clinical consultant.

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